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The numbers
$11.7 billion – Nike’s first quarter revenues, up 1% year-over-year
$4.5 billion – Nike Direct revenues for Q1, down 4% year-over-year
$11.4 billion – Quarterly revenues for the flagship Nike brand, up 2% compared to the same period last year
$6.8 billion – The sportswear giant’s wholesale revenues, up 7% year-over-year
$366 million – Converse’s revenue for the quarter, down 27% compared to last year
Watercooler talk
Nike’s quarterly results exceeded investor expectations, but its chief executive (CEO) Elliott Hill said on an earnings call that its “journey back to greatness has only just begun.”
Facing sluggish sales and increased competition from upstarts like Hoka and On, the sportswear giant is in the midst of a turnaround plan to restore brand relevance and growth.
As part of that turnaround, Nike reorganized its business to be segmented by sports, rather than the men’s, women’s, and children’s categories. Recent marketing, such as this year’s Super Bowl ad, has focused on big sporting moments and specific athletic communities.
That strategy appears to be paying off, with the running division growing by more than 20% this quarter.
“In the marketplace, organizing by sport gives us a much clearer point of view,” Hill said.
Another bright spot for the brand was its partnership with Kim Kardashian’s brand Skims. NikeSkims launched in September, marking the first time the sportswear giant has created an entirely new brand with an external company.
“Our new partnership with Skims is another opportunity to bring something unexpected to a new consumer,” Hill said. “Early consumer response was very strong.”